On June 2, 2022, U.S. Citizenship and Immigration Services (“USCIS”) announced the release of Form I-956F, Application for Approval of an Investment in a Commercial Enterprise, and its accompanying instruction manual. This is the much-awaited “project request” form.
Form I-956F Required Before Immigrant Investors Submit Form I-526
Pursuant to the EB-5 Reform and Integrity Act of 2022 (the “Reform Act”), a regional center must submit to USCIS a project request before an immigrant investor may submit an application for permanent residency under the EB-5 immigrant investor program. The project request does not have to be approved before investors may file their green card applications.
Prior to the statutory sunset of the Regional Center Pilot Program on June 30, 2021, a regional center could optionally request an exemplar approval from USCIS using the old Form I-924. An exemplar petition was not required for investors to submit Form I-526, Immigrant Petition by Alien Entrepreneur. The new Form I-956F, however, is required. Form I-956F has some commonalities with the now-retired I-924 but has many important differences as well.
Key Differences between Form I-956F and Form I-924
Part 1 of the 14-part, 17-page form asks if the project was previously approved in an exemplar petition prior to March 15, 2022 (the enactment date of the Reform Act). This suggests that USCIS will consider a previous exemplar approval when adjudicating Form I-956F.
Form I-956F requests the name, ownership, organizational structure, and contact information for both the new commercial enterprise (“NCE”) and the job-creating entity (“JCE”) affiliated with the project. Applicants must also indicate the project’s location, whether it’s in a targeted employment area (“TEA”) and how the TEA was determined, the expected amount of EB-5 capital investment, and the industries affected by the project.
For many projects, the most cumbersome aspect of an I-956F petition will be the mandatory Form I-956H, Bona Fides of Persons Involved with Regional Center Program, which must be completed and signed by all natural persons in a position of substantial authority in the NCE and JCE. This includes owners, principals, officers, directors, board members, executives, administrators, or other persons with “substantive authority to make operational or managerial decisions over pooling, securitization, investment, release, acceptance, or control or use of any EB-5 capital from immigrant investors.”
The regional center must certify in Part 6 that all material risks have been disclosed to investors and state whether any of the entities affiliated with the project are subject to bankruptcy. The regional center must also disclose any pending litigation and potential conflicts of interest on Form I-956F.
Additionally, the regional center submitting Form I-956F must certify that it has policies and procedures to monitor the issuance of securities. A regional center must have already included satisfactory evidence of policies and procedures (“P&P”) with Form I-956, Application for Regional Center Designation, to obtain a designation from USCIS.
Form I-956F requires regional centers to submit copies of all offering documents. This may include the offering memorandum, subscription agreement, limited partnership agreement, loan agreement or equity purchase agreement, business plan, economic impact study, TEA validation report, and other relevant documents. A best practice is to include a complete I-526 template.
The filing fee for Form I-956F is $17,795, which is the same as the old Form I-924 and the new Form I-956. Therefore, a regional center raising capital for a single project will effectively pay the same fee twice: $17,795 for Form I-956 and $17,795 again for Form I-956F.
Instructions to Form I-956F Indicate Likely Retirement of Old Form I-526
The Instructions to Form I-956F refer to a new Form I-526E, Immigrant Petition by Regional Center Investor, which has not yet been released by USCIS. The name of the form suggests that the old Form I-526 will be retired and replaced with two new forms, one for regional center investors and another for direct EB-5 investors.
Recommendations for EB-5 Regional Centers Filing Form I-956F
First, to maintain compliance as it relates to the P&P certification, EB5AN recommends that regional center operators treat their P&P manuals as living documents, with regular reviews and updates to stay current with EB-5 regulations and industry best practices.
EB5AN also recommends that regional center operators make and maintain a comprehensive list of all persons involved in either the NCE or JCE who could be required file Form I-956H and inform the parties early of this requirement. Regional centers and project sponsors may wish to conduct background checks or informal screening of employees to identify potential problems before submitting the Forms I-956H with Form I-956F.
For companies that have submitted I-956 petitions, EB5AN recommends they prepare their I-956F filing package(s) early, while awaiting approval of the regional center designation. The required information and documentation is considerable, and USCIS will reject incomplete applications. Because immigrant investors in a project may submit their I-526E petitions before approval of Form I-956F, it is imperative that Form I-956F pass the scrutiny of USCIS.
EB5AN is committed to helping other EB-5 industry participants navigate the recent changes to the EB-5 program. For help filing Form I-956F, schedule a free consultation today.